Tuesday, September 6, 2011

Bob Murphy shares this from Paul Krugman: "The appeal to the intellectually insecure is also more important than it might seem. Because economics touches so much of life, everyone wants to have an opinion. Yet the kind of economics covered in the textbooks is a technical subject that many people find hard to follow. How reassuring, then, to be told that it is all irrelevant–that all you really need to know are a few simple ideas! Quite a few supply-siders have created for themselves a wonderful alternative intellectual history in which John Maynard Keynes was a fraud, Paul Samuelson and even Milton Friedman are fools, and the true line of deep economic thought runs from Adam Smith through obscure turn-of-the-century Austrians straight to them."

Bob is impressed Krugman even knew about the Austrian school that long ago, but what struck me is that I've heard something like that from Austrians before.

Peter Boettke once wrote: "I have made the distinction in my writings between the "mainline of economic teachings" that can be traced back to David Hume and Adam Smith and runs forward to F. A. Hayek, James Buchanan, etc., and "mainstream economics" which is more or less a sociological concept related to what is currently scientifically fashionable among elite academic economists."

You can't really blame Krugman for pointing out that some people think exactly what Boettke claims here. I suppose you could get on him for talking about intellectual insecurity, but if you're going to do that make sure you also get huffy over the claim that what the mainstream thinks is just the fasion of elites.

5 comments:

"Because economics touches so much of life, everyone wants to have an opinion."

Krugman comes at this all wrong; it isn't that everyone wants to have an opinion, it is that everyone gets to have an opinion. Indeed, weren't you the one earlier talking about the importance of popular sovereignty?

Indeed, I'd like to interrogate this comment a bit further. Why does it surprise Krugman that his style of economics fails in supranational states?

Anyway, all disciplines work this way - history for historians, "memory" for everyone else, or, to use a more concrete example, the Dead Sea Scrolls should be attributed to the Essenes (the dominant theory today) vs. other theories.

Gary I can't make heads or tails of your comments. Do you think that everyone wanting an opinion and everyone getting an opinion are in conflict? Why? What do you mean "his style of economics fails in supranational states"? What do the Essenes have to do with this?

The point is to consider how useful it is to base your way of seeing things upon a Euclidean way of doing the business of thinking, etc. (this is where Krugman and I agree); yet despite Krugman's criticism of what we might call "vulgar Austrians," a simple set of axioms is what the Keynesians base their ideas upon as well; from thence flows everything else. Indeed, it is surely the case that there are whole classes of economists and economic streams of thought that are discounted via the mainstream, even though that is hard to justify on anything like objective grounds.

Not GG, but I think what he's saying is that PK is incredibly elitest in his comments. Not only that, but he's claimed to have a pro-democratic (populist elemsnt to him).

Put it this way: There's a professional "body of knowledge." There's what "everybody knows." Those two aren't normally synonymous, and when it comes to politics. the "everybody" can normally beat the "professional." Krugman appears worried about this. But, as the article on libertarians you linked to last week suggests, to be opposed to democracy is to be in favor of Pinochet. Therefore, PK makes an argument that says the people who [may] vote against his chosen course of action are ignorant.

What say you, DK? If the electorate turn against Keynesianism are they ignorant? If they're ignorant, should their opinions not matter?